Insurance companies are relying more and more on credit histories to determine a consumer's insurability. Those with poor credit histories are often penalized with higher premiums or, in some cases, outright denial of coverage.

Many states are imposing tighter standards for insurance companies to meet before using consumer credit histories. Insurers that conduct credit checks on applicants without specifically informing them face the ire of Arizona's Department of Insurance and the state legislature.

Arizona incorporated new federal privacy regulations into the state's existing Information and Privacy Protection Act that prevents insurance companies and all other financial institutions from viewing consumer credit reports without consumers' direct consent.

States like Arizona are not convinced that the insurance industry is able to draw a direct correlation between a person's credit history and the likelihood that the person will file a claim. Insurance companies have been reticent to share data that they claim prove the link.

Arizona's regulations also address the issue of "fine print," requiring insurance companies to state, in clear and plain language, that it asks to perform a credit check and how it intends to use the information. Regulations require that this portion of the insurance contract also be designed to draw attention to it, rather than hidden inside other information.

Even insurance that is sold via the Internet is subject to these regulations, which require that the insurer "place a notice on a screen that consumers frequently access, such as a page on which transactions are conducted, or place a link on a screen that consumers frequently access that connects directly to the notice and is labeled appropriately to convey the importance, nature, and relevance of the notice."